Suze Orman New Book – Is It Best To E-File My Taxes?

Is e-filing a better way to record your taxes? 

Americans and the IRS might not agree on everything, but they’re largely on the exact same page when it comes to e-filing individual income tax returns.

Nearly all individual income tax returns submitted to the IRS are e-filed. 

And in return, you could find any refund you’re owed faster, especially if you have it directly deposited to your bank account.

But what about security?  And can digital filing actually give you access to all of the forms that you might need if you have a complex tax situation?  Are there ever situations when you can not e-file?  Let’s look at the benefits of e-filing, and if it may be the very best filing option for your requirements.

If you’re Considering e-filing, a Few of the advantages include:

  1. Quick confirmation your forms have been obtained: The IRS will confirm a tax filing was received within 24 hours of electronic submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived . 

    Timely refunds: When you publish a paper filing, it can take six to eight weeks to be given a tax refund.  With e-filing, you’ll get your money in three weeks or less.  Choosing direct deposit can also speed up the refund process.

  2. Reduced chance of errors: According to the IRS, there is around a 1 percent error rate on e-filed yields, compared with a 20% speed of mistakes on paper filings.  The IRS also provides more info on issues discovered on e-filed returns compared with paper yields.

  3. Simple payment procedure: If you owe the IRS money, it is easier to cover at your advantage if you e-file.  You can submit returns early and pay later if necessary, as long as you pay by the April 15 filing deadline.  Additionally you have the choice to pay your balance by using the IRS Direct pay service from your checking or savings accounts, filing a credit card through a payment processor for a fee, or paying by check or money order.  Just be aware delaying payment following the filing due date (typically April 15) will lead to interest and penalties.

  4. Digital storage of tax information: Submitting returns electronically means there’s a digital copy of your tax records.  If something happens to your paperwork, you’ll have an electronic backup.

The fantastic news: Most taxpayers do opt to e-file and get those benefits — and the practice of doing so is simple.

The way to e-file a tax return?

The types do the math for you and provide standard guidance.  You can simply do your federal return with all these kinds. 

  • Use an online tax preparation tax or service applications: Tax prep software and online filing services are alternatives.  These options are an easy way to finish and e-file your forms.  Some applications suppliers charge for their apps, Some are free.   The program asks you simple questions about your life and finances to steer you through the completion of your types.  
  • Get free, in-person tax help: In most states, you can find volunteers to help prepare and e-file yields.  But eligibility for free help is normally restricted based on income, and a few services cater to particular demographic groups.  By way of example, Tax Counseling for the Elderly programs focus primarily on helping filers who are 60 and older. 
  • Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they are authorized IRS e-file providers. The IRS maintains a database of licensed providers, but be aware this alternative is very likely to be the most costly one. 

    Using online tax prep software is far and away the preferred approach of most taxpayers.  In fact, the IRS says it expected over four tax returns to be submitted through tax return prep program.

    Is e-filing really stable?

    While e-filing is convenient, you could be worried about security — especially with so many data breaches.  But experts agree this is not an issue that should deter you by e-filing.

    “E-filing a tax return has turned out to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product leadership, marketing and sales at LegalShield. “In fact, it can be more secure than paper filing as you’re sending your personal information through an encrypted network rather than exposing your information in the email.”

    Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has set safety measures in place to keep your data safe.  “Trainers normally use IRS particular APIs that need token sessions,” Chow says.  “All this can be routed over TLS encrypted connections.”

    It’s very important to employ a trusted service to assist you record your taxes.  Chow advises not to e-file on a computer or use an internet connection which isn’t confidential.

    Bottom line

    For many taxpayers, it is sensible to e-file a return because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment options.  Just make sure to use tax planning software from a dependable source, so that you may ensure the information you provide to transmit to the IRS will be kept protected.